Great Wolf Resorts Q4 2008 Earnings Call Transcript

Great Wolf Resorts (WOLF)

Q4 2008 Earnings Call

February 25, 2009; 10:00 am ET

Executives

Kim Schaefer - Chief Executive Officer

Jim Calder - Chief Financial Officer

Analysts

Bill Crow - Raymond James

Steven Wieczynski - Stifel Nicolaus

Hayley Wolff - Rochdale Securities

Jeffrey Thomison - Hilliard & Lyons

Will Marks - JMP Securities

Presentation

Operator

Ladies and gentlemen, thank you for standing by. Welcome to the Great Wolf Resorts fourth quarter 2008 earnings conference call. During today’s presentation all parties will be in a listen-only mode. Following the presentation the conference will be opened for questions (Operator Instructions) This conference is being recorded today Wednesday, February 25, 2009.

I’d now like to turn the conference over to Jerry Daly; please go ahead sir.

Jerry Daly

Thanks you Brandy and good morning everyone and welcome to Great Wolf Resorts fourth quarter and full year 2008 earnings conference call. This morning Great Wolf released their fourth quarter and full year 2008 results and I hope you’ve had a chance to review the press release. If for some reason you did not receive a copy of the press release, please call our office at 703-435-6293 and we’ll be happy to either fax or e-mail you a copy.

You also may view a copy of the release at the company’s website www.greatwolf.com by clicking on Corporate Site at the bottom left of the page and then clicking on the news release button. The replay of this conference will be made available later today at www.streetevents.com for 30 days. Replay of the calls also will be posted on the company’s website through March 25, 2009 and the recording of the call will be made available by telephone until Wednesday, March 4, 2009 by dialing 800-405-2236, using the reference number 11125895.

The conference call is the property of Great Wolf Resorts and any redistribution, transmission or rebroadcast of this call in any form without the expressed written consent of Great Wolf is prohibited. Management has asked me to inform you that in compliance with the SEC’s Safe Harbor guidelines, certain statements that might be made during today’s conference call could be considered forward-looking and subject to certain risks that could cause results to differ materially from those projected.

Those statements may include, but are not limited to estimates of the company’s future revenues, earnings and development activities. I refer you to the company’s SEC’s filings for further information on the factors that could cause actual results to differ from any estimates.

Now I’d like to introduce Kim Schaefer, Chief Executive Officer and Jim Calder, Chief Financial Officer, who will provide you with some insights into the company’s fourth quarter and full year 2008 financial and operating results.

Let me turn the session over to you Kim.

Kim Schaefer

Thanks Jerry. Good morning everyone. I’m joined today by Jim Calder, our Chief Financial Officer. Since, our call in November the news from Walls is that our fourth quarter results of our operations were at the top of our guidance. Our RevPAR results continue to exceed the lodging industry averages and our Mason loan maturity was refinanced until the end of November, 2009.

My remarks will focus on fourth quarter and year-to-date operating results, first quarter insights and development then Jim will provide more information on capital markets and 2009 outlook.

Our fourth quarter RevPAR decline of 7.9% outperformed hotel industry RevPAR performance by 200 basis points. Fourth quarter is a soft leisure period and we attribute most of the decline to group bookings, which was down 8% over prior year. For the quarter same store occupancy was down 260 basis points and ADR was down just under $7 and as a result of the yield management to shorter term bookings and more competitive group rates.

Ancillary revenue per occupied room for our wholly-owned same store Great Wolf Resorts increased 2%. We have found that guests continue to pay for unique amenities that they can only get at Great Wolf Resorts. Our Generation I Resorts are in the Midwest and have been impacted by the macroeconomic environment in that region for some time. Total same store RevPAR for these resorts decreased 15.6% in the fourth quarter and 6% year-to-date.

We still believe we have competitive resorts in these areas and they will eventually produce better same store results as economic conditions improve. We did have 61% repeat and referral business for fourth quarter. So, it does show strong brand recognition and loyalty to these Midwest properties.

Our Generation II Resorts are the newer 400 room resorts with the full range of branded amenities including conference centers. Total same-store RevPAR declined 4.9% in the fourth quarter, but was up 3.9% year-to-date. These resorts contribute over 80% of the year-to-date adjusted EBIDTA.

Year-to-date, our overall company adjusted EBIDTA was 27% of total revenues, which was equal to prior year. With two new resort openings in 2008, Concord under construction, Grapevine expansion and the economic downturn, we feel that our team did a great job of accomplishing our goals as well as making adjustments to reflect the changing environment and being efficient for the future.

Despite in increasing commodities during 2008, our food and beverage had a flat cost of sales over prior year, which is attributed to consolidating higher volume commodity purchasing and many design as well. We’ve also made a lot of strides in energy consumption. For example our Pocono resorts save 9 million gallons of water last year with the implementation of our project Green Wolf, which is our environmental sustainability program.

For 2008 Gen I saw a decline in operating margins of 4%, but Generation II same-store resorts increased their margins by 1.7%. The fourth quarter the resorts had 6% decline in EBIDTA against the 7% decline in RevPAR, which really demonstrates the amount of time spent over the last few months that these resorts have been focusing on the operating margins for this new economic environment.

Moreover, we have contingency plans in place should the downturn in RevPAR become more severe. Looking at first quarter, Wolf RevPAR has outperformed the hospitality market by 2% in the fourth quarter and 3% in all of 2008. We expect that better relative performance to continue because our business model does offer alternative to family vacations and we’ve always been a value proposition for our families looking for quality, but convenient getaway.

The new consumer research that we have says that families are cautiously optimistic about the future and they’re willing to forego other amenities in order to afford time away as a family. We will also continue to fill weekday business with groups and the first six months of 2009 are currently on pace with where we were in 2008. We feel that we are very competitive with our convenient location and state-of-the-art conference centers.

We started the year out well, with January same store RevPAR showing a 1.4% increase over prior year, while Smith Travel is showing the U.S. RevPAR down 18.5%. We expect February will finish the month down 3% in RevPAR for all same story resorts. We have provided you guidance for Q1 in the range of $12.4 million to $14.4 million, which is a 10% decrease in RevPAR.

This does reflect, however the impact to the shift in with two peak weeks coming out of March and into April. We normalized January through April 2009 to 2008 and overall we would be forecasting down RevPAR 5% with that shift. This compares to the Smith Travel Research estimates of Q1 decline of 18% to 20%.

So we are relatively happy with January and February thus far. We have to be conservative as our visibility is minimal. 70% of our leisure reservations come within a 21 day booking window and we are seeing a shift to a 14 day decision time.

In development news, the 203 guest suites addition to our Grapevine, Texas resort opened in December just in time for the holiday season and it was well received and those rooms were utilized for that 16 day period.

Our new Concord, North Carolina resorts will open next month in time for spring break, it’s on time and it’s on budget. We’ve had a very busy job fair about three weeks ago and we are able to hire a full staff. So, we are very much looking forward to delivering a great guest experience to the families in the Carolina’s.

While we are not making material commitments on development for future resorts right now, we do continue to make progress on our previously announced LOI with Mashantucket Pequot Tribal Nation for a Great Wolf Lodge near their Foxwoods Resort Casino.

Now Jim, I’ll turn it over to you might discuss capital markets and 2009 outlook.

Jim Calder

Okay, thanks Kim. As our release mentioned we recently completed negotiations to extend the maturity date on our Mason Ohio Resorts mortgage loan. The extension date goes to November 30, 2009. We think the lenders willingness to work with us on this extension and allow us to keep this resort in a portfolio was a good outcome for us.

The Mason resort opened in late 2006 and it’s been improving its performance annually since. We continue to think that this Mason asset can be as strong long term performer for us, although, the economic climate in Ohio will strongly influence this growth potential in the near term. We think we can continue to grow the value of the resort by increasing its operating performance.

The terms of the Mason loan requires to pay down $15 million of principal loan by the November 30, maturity date. Important to note is that our current cash flow projections based on the earnings guidance we provide for 2009 in today’s release show that based on our current cash balance in those projections, we will be able to satisfy the $15 million principal pay down from cash provide by operations and I’ll do a little summary of that a little bit later in my remarks to walk you through that.

As we’ve mentioned previously, we are also working at several other potential liquidity enhancing scenarios, such as sales of equity interest and some of our resorts or re-financings of other existing loans, but the timing of those just voluntarily dependent on the external capital markets and as you can surely appreciate, because of that, it is difficult to predict the timing or certainty of those types of events.

As 2009 progresses, we will continue to look at strategic options to refinance or further extend the Mason loan. Other than that loan, we do not expect to have any significant debt maturities until mid 2011. This should give us adequate time we think, to wait for some stabilization and recovery of the lending markets.

As we said before and reiterate in today’s release, we do not plan on making any material equity commitments or begin construction on future development project until we have both equity and debt capital fully committed. Although, this may slow our long-term growth plan, it is clearly the prudent course in today’s uncertain capital market environment.

The only significant remaining construction cost we have as of today related two things. One is completing construction on our Concord North Carolina resort that Kim mentioned, that’s scheduled to open in late March and second is completing minor remaining portion of the Grapevine resorts expansion project. We expect that all remaining costs of the Concord project will be funded through the existing construction loan on the project. So, it should not require any cash off our balance sheet.

The Grapevine remaining costs to be paid, while be paid by cash from operations. Again, once these two construction projects are complete, we do not foresee any significant near term capital expenditures at our resorts. We will continue to expand approximately $8 million annually allowing to our maintenance or recurring CapEx at the properties we consolidate for financial reporting purposes, but we expect that amount will be more than sufficient to pay for recurring needs and small revenue enhancing projects at those resorts.

Based on the information in today’s release and our other comments, let me walk you through a very high level look at our cash flow projections overall for 2009 and there are five components to this analysis and I’ll walk you through those five components. The first component is the midpoint of our adjusted EBIDTA guidance, which is about $63 million for 2009. As we note in the press release, this assumes an approximately 5% to 8% same store RevPAR decline for the full year.

In addition it assumes about a 3% to 5% unlevered return on our total investment in the new Concord resort and the Grapevine expansion. The Grapevine expansion really just opened in December, 2008. That total investment was about a $175 million between those two items. So, that the $63 million of adjusted EBIDTA is the first component of this cash flow overview.

The second component is debt service. This is interest and principal including the $15 million principal pay down on the Mason debt for the year and we estimate that will total approximately $57 million for 2009. The third component that I just discussed earlier here in my comments is our recurring maintenance capital expenditures and we estimate that to be approximately $8 million for 2009.

The fourth component, are the total cash outlays related to completing the Grapevine expansion project, that I mentioned. That project majority of that opened in December of ‘08 there are some minor parts still being completed and we pay those costs as it occurs in 2009 and that should total about $9 million of cash to be used in 2009 and the last component relates to some subordinated debt that we have with our Grand Mound joint venture.

We had at the beginning of the year $12 million of subordinated debt that we had loaned to that joint venture. Our partner in the joint venture purchased half that debt or $6 million worth at par in January. So, that was a $6 million cash inflow in January.

We also expect based on our projections for that resorts performance in this year to receive an additional $2 million of principal pay down on that debt during 2009. So, $8 million in total coming from the subordinated debts to the Grand Mound joint venture.

These items, that analysis of the fifth and last component and these five components represent all the major cash inflows and outflows we clearly project for 2009. If you factor all these together, we expect to be roughly cash flow neutral for the year. The net of the five items, I just described was a decrease in cash of about $3 million.

We entered 2009 with unrestricted cash of approximately $14 million. So, absent any significant downturn in our expected operating results, we expect we will have sufficient liquidity to operate our current business for the remainder of 2009.

Operator, with that we are ready to take questions.

Question-and-Answer Session

Operator

(Operator Instructions) Your first question comes from Bill Crow - Raymond James.

Bill Crow - Raymond James

Just a few questions here, what is the total cost done in the Grapevine addition start to finish?

Jim Calder

The total for the Grapevine expansion is approximately $42 million.

Bill Crow - Raymond James

The Charlotte area asset, how much more do you anticipate spending on that? Did you mention that?

Jim Calder

I didn’t give that number for 2009 because all of the expenditures for Charlotte in 2009 are all that it come off the construction loan.

Bill Crow - Raymond James

I want to make sure I got my debt balance correct. How much more do you the think?

Jim Calder

That’s about $40 million in 2009.

Bill Crow - Raymond James

Forty million dollars additional?

Jim Calder

Yes.

Bill Crow - Raymond James

Then capitalized interest; how much was it in the fourth quarter and with the opening of the two projects does that just end at some point this year? What would the timing of that be?

Jim Calder

I don’t have the cap interest number for the fourth quarter Bill, but we can get back to you on that. The capitalized interest you’re correct. Once we have no major construction projects in place, we will no longer be capitalizing any interest.

So, our capitalized interest period, we are still doing some a minor part of the Grapevine expansion adding some elevators down there. So, there is some capitalized interest still Grapevine here in the first three, that’s should be done in March and then on the Concord Resort, once that opens called the end of March, then capitalized interest will terminate on that as well.

Bill Crow - Raymond James

Then finally, Kim, it’s been rumored out there that the Pocono’s asset has been marketed for sale. Can you give us any update on that? Is that the only asset that’s actively out there in that process? What sort of interest level have you received, if you are indeed marketing that etc.? Anything you can highlight for us on that asset?

Kim Schaefer

I think that we are always open mind, what’s the best interest of the company. I think their recycling capital is certainly one of those options and the Pocono’s is one of those assets. We’ve have had a lot of interest, but nothing to the point that we are moving forward on anything.

Bill Crow - Raymond James

Is that the one that the asset you are marketing right now? Are there books out on other assets? Can you give us a feel for that at all?

Kim Schaefer

No, that’s the only one right now and really I think again it was just one of those things to look at recycling of capital and does it make sense in this market and what you can do with that asset, so as always it would maintain a long term license and management contract, but that’s the only one that’s active right now.

Operator

Your next question comes from Steven Wieczynski - Stifel Nicolaus.

Steven Wieczynski - Stifel Nicolaus

Just following on last question, can you go into a little more detail in terms of why the Pocono’s, why that asset?

Jim Calder

We looked at a number of different factors and thinking about, which assets might be attracted outside people. One of the primary factors frankly on Pocono’s is that it has a loan, which is fairly easily assumable by a potential buyer and that is a little bit different than some of our other loans.

So, for that reason given the capital market conditions today we thought that could be attractive possibly to someone or could induce somebody to take more interest in it. So, that was one of the primary drivers and looking at it, but not the only driver, certainly.

Steven Wieczynski - Stifel Nicolaus

Then going to the expense side of the equation, it looks like in the fourth quarter you did a pretty good job in terms of SG&A, down pretty significantly year-over-year and even quarter-over-quarter and can you talk about what you took out of there? What’s the pretty good run rate going forward?

Jim Calder

SG&A, it did decline in the fourth quarter. I think it’s due to a couple of different factors. One is frankly our numbers were not what we expected them to be after three quarters given the where the economy shifted when out so, at the corporate level and at the resort level as well, we had some decrease in our expected incentive compensation for people, frankly and that probably was, I mean year-over-year that was probably a $1.5 million that it declined. Other than that, as Kim mentioned we also implemented a lot of cost controls and cost structuring in the fourth quarter and I’d estimate that was probably the reason for the remainder of the decline.

Steven Wieczynski - Stifel Nicolaus

The last question for Kim, I guess just little over in terms what are you seeing in terms of Easter bookings so far? Then also once customers get to the property, what have spending levels looks like, once they arrive?

Kim Schaefer

The shift in the Easter, being that we have the 21 day booking window right now our bookings are off for Easter as they were for December, January and February, quite frankly we are rewriting our pace in hotels and how we look at things daily. So, we like that the pace that we see, but because Easter shifted two weeks into April, we’d expect that we still have another two weeks before we really see a strong booking pace on that. That is part of reason, why we had that shift down about 5% over the spring break period.

Looking at January and seeing the strong results we had in January, we are cautiously optimistic as the phrase that we are using around here and making sure that the marketing plans are executed, performing and that we are tracking and doing a good job of selling at our call center.

As far as the ancillary spent in property, I mean fourth quarter we were up at a wholly owned assets. So, I think we are finding is that people are making decisions on what they are going to spend money on and each resort has a little bit different flavor, but in general the things that are like our unique amenities like the magic and the scoops that are completely discretionary, people are still spending money on. So, we are happy about that. We are not planning on rolling out of whole lot of new revenue amenities. We are really focused on the guest experience, as well as monitoring how we spend money this year.

Operator

Your next question comes from Hayley Wolff - Rochdale Securities.

Hayley Wolff - Rochdale Securities

A couple questions; first, the potential marketing of the Pocono, given the cash flow that you laid out for the year and I am recognizing you have a leveraged balance sheet, what’s the logic of selling a resort in this environment? When you really not going to get full price realization? How do you balance that with, this obviously the need to raise some cash on your balance sheet, just in case?

Jim Calder

Hayley its Jim. I guess I will start and probably Kim may have comments to add. I think its both. I mean obviously, liquidity is greatly valued in the world today. We would like to be more liquid than we are; we think we have as I walk through more than sufficient liquidity for the year, but a little more liquidity would be a good thing.

As Kim mentioned, under any scenario we would maintain a long term involvement with Pocono’s resort or any resort that we would sell. We would look to keep a long term involvement through management license and keep those fee streams in place and have those as relatively stable fee streams without any leverage and with out much operational risk and really gets to also as Kim mentioned our wish to look at ways that we can recycle capital and keep growth moving in an environment where really our competitors are unable to grow.

We are trying to find opportunities throughout that we can capitalize on that and ways to do it and looking at the potential sale of any of our assets is one possible avenue to do that and I don’t know Kim if you’d anything to add.

Kim Schaefer

I think giving, what you can give in this market when we looked at putting this resort up for sale late last fall, we really don’t know what the trading values are going to be. So, I don’t think that we would do anything that does not gives us the adequate return on investment that we’d need to move forward on either just holding it for liquidity or putting into a future asset.

So, I think as we get down the road on that we will definitely have to weigh those consideration, but its not some of the good news is that we sit today, its not something that we have to do. So, I think that’s how we look at it. Right now, we’ll see what the possibilities are out there and if we don’t like what we see then we don’t have to sell it. It is not in that type of a situation.

Hayley Wolff - Rochdale Securities

Next question the Grapevine expansion; can you give us a sense of how the bookings or the occupancy have held up or at that property as you’ve added more rooms?

Kim Schaefer

Actually, it’s a great question and certainly in this environment people asks if you would have done that room expansion, but the good news is in the 45 days that’s been opened as it has performed very well. We had 591 rooms two weekends ago. We did use the 200 rooms during the 16 day holidays period right after they opened and now with the conference center opening, in January we had our grand opening, the group pace has been excellent at that property. So, we’re actually we’re very pleased with the performance of Grapevine.

Hayley Wolff - Rochdale Securities

Then on Concord any indications that are early booking pace, what’s going on in terms of building enthusiasm in the markets for that?

Kim Schaefer

We’ve been very well received on that. I was there in January we had our hard hat tour which kind of allows the community to come in and take a look at the resort meeting with the some of the community leaders and we’ve been well received. They’ve been very helpful to us. While we’re still early the advance reservations are on pace with previous resort openings.

I mean as we looked at like where we were last year with Grand Mound. It was opened at the same time. The call volume, the inquiries are equally strong plus we just started on Monday. I believe our marketing campaign for the opening. So, we are getting ready for a soft opening launch towards the end of March. So, I think where we sit today, we’re actually very optimistic based on previous openings. So, it’s been a very good process down there.

Hayley Wolff - Rochdale Securities

On the cost cutting initiatives for 2009, what are you focusing on both at the corporate level and then at the property level?

Kim Schaefer

At the corporate level we’d already kind of made most of our adjustments. We had reduced about 30% of our labor cost in development and then kind of restart with headcount by about 15%. So, really from a corporate standpoint, we are pretty well set with the operations that we have here.

At the resort level, what we’ve done is really taken a look from everything from labor which is obviously our largest and what we’ve done as we try to remodel how we operate and that has been. So, those will be permanent adjustments rather than cuts, as our team grows and develops over the years.

We’ve been able to now give them more responsibility and how we manage and really they are looking at hourly staff for maximum efficiency and we’ve been looking at everything nearly from hours of operation for the outlets, inventory levels and just the efficiencies and how we purchase, when we purchase and every decision is really a thoughtful decision on our purchases, but we are making sure that we’re not negatively impacting guest service or safety obviously.

Operator

Your next question comes from Jeffrey Thomison - Hilliard & Lyons.

Jeffrey Thomison - Hilliard & Lyons

First of all, most of my questions have been asked and answered. Jim thanks for the color on the cash flow component. That’s helpful. So, it saves me some questions on, but one item you mentioned regarding debt service interesting and principal of $57 million. Do you have a breakdown as to how that is allocated towards interest and principal?

Jim Calder

I don’t have it with me, Jeff on top of my head. I would say it’s about close to $20 million of principal all then and $37 million of interest, but I don’t have that handy.

Jeffrey Thomison - Hilliard & Lyons

Then lastly did you have any balance sheet highlights, such as total assets, total liabilities or shareholders equity?

Jim Calder

We don’t today. We should be filing our 10-K here, within a few days and obviously all that detail will be in there, Jeff, but we don’t have that here today.

Jeffrey Thomison - Hilliard & Lyons

Then I’ll follow-up offline with some additional questions later today. Thanks.

Operator

Your next question comes from Will Marks - JMP Securities.

Will Marks - JMP Securities

I have a couple of questions. One, can you give a run rate interest expense figure once all of the capitalizations runs off?

Jim Calder

I think our run rate; obviously, we have some floating rate debt. So, it’s a little bit difficult, it depends on some estimation of where you think LIBOR’s going that type of thing, but run rate interest expense, I’d say be around $40 million annually. Once we are done with capitalization and all that and again that’s based the debt in place today, the rates in place and as projected for ‘09, but that’s a rough number Will.

Will Marks - JMP Securities

Second, big picture question; not taking anything away from your quality assets, it seems clear that drive to leisure travel would steal market share in this environment. Have you done any studies on this? Can you give any kind of quantitative information, survey information or even just qualitative information? It would be very helpful.

Kim Schaefer

We haven’t done any qualitative studies, but we did get a study that was done on just consumer spending in general and as mentioned that. Families are willing to make other sacrifices that they can spend money for at family getaways, family vacation. So, we think that we are pricing, whether it’s been well, high gas prices, the shift in other economic times, we do seem to perform well. So, I think that it leads to that.

One of the other things that was interesting that we found in our consumer research that we got was that time is no longer more important to consumers than money, because before they were willing to pay more money that was convenient for them, but now they are saying money is more important to them, but we still that we play well in that because our entire platform is a value proposition for families.

So, the convenience is certainly one of them, but the value proposition of being able to come to our resorts for two days, one night or for two nights three days really makes that important. We also saw in January and in February even in last summer that your statement does ring true they are still making that decision to come to our resorts.

Will Marks - JMP Securities

In terms of the spending at the resorts I think, the figures you gave for year-to-date were RevPAR. Have we seen any change in total RevPAR as the spending outside the room decreasing in a different pace?

Kim Schaefer

No, I men actually, for the Gen II resorts, they have the fuller breadth of amenities. We actually saw that went up in fourth quarter by 2% as well as for the full year, but we are still seeing that increase in spend and there is not just one general place that they are seeing it, but one of the key stat is that we are seeing things like our Magic Quest and Scoops Kids Spa those are still seeing year over year growth and they have been in all of the resorts, since beginning of 2008 or 2007. So we’d them for a full two years now.

Will Marks - JMP Securities

My last question is just on competition and I realize there is no one building out there, but let’s say I guess in Sandusky and Wisconsin Dells, you no longer have wholly-owned assets, but if you could comment on those markets or others where there is competition and how you are doing versus your competitor asset?

Kim Schaefer

Well, because we are the only public company. We are the only one that reports any type of numbers, but from what we know especially of our Wisconsin Dells community up there. I think everyone saw the shift this summer.

They had some troubles with Lake Delton emptying in a lot of the issues they had up there were probably more issues related to Wisconsin Dells and it wasn’t until late summer that they saw some of that rebound, but it seems to me again not having all of the information reported that everyone is telling the same issue.

The Wisconsin Dells in particular has not seen any more guests coming to that region, but yet there is always some new supply whether it’s a time share condos in the last few years of that growth. So, I think that’s the challenge for the market up there as we are all sharing the same customer base.

Operator

And at this time we have no further questions in the queue. I’d like to turn the call back over to management for any closing remarks.

Kim Schaefer

Thank you. We know that 2009 is going to be operating in a challenging environment, but we are pleased that the brand continues to offer value proposition for families to enjoy and that our 5000 pack members are committed to delivering that experience and as always I thank them for dedication and passion to the company.

We will continue to evaluate the outlook for business, adjust the cost controls accordingly in order to deliver the maximum value to both the guests and our shareholders. Thank you for your interest in the company and we look forward to updating you on our progress again next quarter.

Operator

Thank you. Ladies and gentlemen this concludes the Great Wolf Resorts fourth quarter 2008 earnings results conference call. If you like to listen to replay of today’s conference please dial 1800-405-2236 or 303-30-00 followed by passcode 11125895. Those numbers again are 1800-405-2236 or 303-590-30-00. Thank you for your participation. You may now disconnect.

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